Neither Auburn Hills or any other city or township can petition to reorganize the Pontiac school district and divide it up between neighboring districts as proposed last week, according to a legal opinion issued to Oakland Schools intermediate district.

The possibility of reorganizing the Pontiac district came up after Oakland County Circuit Court ordered a summer tax levy of $7.8 million to cover unpaid Michigan Education Special Services Association teacher health insurance premiums the financially struggling Pontiac district did not pay for a year.

However, Pontiac School Superintendent Brian Dougherty said Wednesday that he remains optimistic the district will be able to get a loan against its property taxes to pay off the debt before tax bills are printed once the state approves the district's deficit elimination plan.

Under the court's consent judgment, the levy is to be spread over property owners in the portions of eight communities within Pontiac school district boundary lines, including the cities of Auburn Hills, Pontiac, Keego Harbor and Sylvan Lake and the townships of West Bloomfield, Bloomfield, Waterford and Orion.

Advertisement

After reviewing the requested legal opinion, Markavitch said in a news release this week that a city cannot petition under the Reorganization of School Districts Act of 1967 to reorganize a school district.

"Based on this legal opinion, the law only authorizes the (intermediate district) to furnish petitions to a school district," the news release read.

"Being that the request was not made by a school district, Oakland Schools is not able to provide the petitions as requested by the City of Auburn Hills."

A district can petition to the state to reorganize itself or to organize another district, Markavitch said.

The intermediate school superintendent said she asked for the legal opinion last week after she was contacted by Auburn Hills City Manager Pete Auger.

Auger and City Councilman Bob Kittle said residents and businesses in Auburn Hills are upset over the fact that property owners in the city will have to pay $4 million of the total $7.8 million owed despite the fact that only 260 Auburn Hills children attend Pontiac schools.

Kittle said earlier that officials were doing research to determine how to react to the summer tax levy. He said a petition drive to reorganize the district is just one tool in the box.

Under the state school reorganization act, the state would have to agree an emergency exists before it would attach the district to one other district or divide it between other districts in a way that would provide "the most equitable educational opportunity for all of the students."

Markavitch said she asked for a legal opinion because this was the first time in her knowledge that an inquiry over the reorganization of an Oakland County district came up.

In the past, under a different law, residents in Bloomfield Township tried on more than one occasion to win approval from the intermediate district board to split off and become part of the Bloomfield Hills district, but the requests were always rejected.

Pontiac leaders trying to stop levy

Despite the Pontiac district's financial struggles and the $37.5 million deficit found in a recent, corrected audit of the 2011-2012 school year submitted to the state, Dougherty is adamant that Pontiac district is on the way out of debt.

The Pontiac school superintendent, who took over the top job in September, said he understands why Auburn Hills officials and residents are upset and why they would consider researching such actions, "because the judgment levy came as shock to a number of people.

"But what I think is missing that was already expressed publicly by the board is (the district's intent) to use tax anticipation notes so the levy will never reach the taxpayer," Dougherty said Wednesday.

"We have been taking some lumps about being financially irresponsible," Dougherty acknowledged, but he said he wants to make clear that the deficit in the recent audit dates back to the end of June 2012 and it has been reduced since then.

"This year started with $37 million deficit and we project it will be down to $27 million by the end of this year, so we have eliminated over $10 million this year," Dougherty said.

"Our numbers are real and include such things as the MESSA payments," said Dougherty, who points out he wasn't leading the district when the deficit was growing for two years.

"But last year and this year, very serious steps have been taken (by the Pontiac Board of Education) and will be taken to get us out of out of this mess," Dougherty said.

Once the state approves the plan, Dougherty said the district can have more formal talks with the state treasury about a tax anticipation or emergency loan.

Meanwhile, a quick survey of adjacent districts early this spring break week turned up no immediate plans on their parts to petition the state to divide up Pontiac schools between them.